Snapdeal's clarification on layoff report

Bengaluru: In response to our story on Snapdeal being in the process of laying off 150 employees at its Bengaluru office, the company's co-founder and CEO Kunal Bahl spoke to several times on Saturday evening. He denied any present or near-future plans of job cuts in Bengaluru. His co-founder, Rohit Bansal, also tweeted a vehement denial. In the light of their statements, the TOI story stands corrected. Our news piece was based on the information provided by senior employees of Snapdeal who were privy to the developments. The employees did not want to be identified, given the sensitive nature of the issue. TOI had carried Snapdeal's official response that the company isn't planning any retrenchment.

Here is the original story.

Snapdeal may cut 150 jobs in Bengaluru office as it rationalises operationsOnline marketplace Snapdeal is in the process of laying off at least 150 people in its R&D tech centre in Bengaluru, sources directly aware of the matter told TOI. The Softbank backed e-commerce company has been on a cost cutting drive as it faces fierce competition from homegrown rival Flipkart and Seattle-based online retail behemoth Amazon amid a sluggish e-commerce market. Sources told TOI the e-tailer eventually plans to wind down its Bengaluru centre but that may take sometime, depending on how much fresh cash it can raise this year.

"It's a simple case of over hiring done in the past and now they are forced rationalise. Many others in the tech team are looking out at other options fearing similar moves in the near future," sources said. Snapdeal's Bengaluru office had a total strength of about 500 people before the trimming of headcount kicked in. "The company is constantly pushing people to move to its headquarters in Gurgaon or leave, for all the employees who are still left," one of the sources said who did not want to be identified.

When contacted, a Snapdeal spokesperson said over an email, "There have been no layoffs at the company and there are no plans of shutting any of our regional offices including the Bengaluru office. We continue to hire people across locations as per our talent requirements. We do not have any plans to relocate employees from Bengaluru to Gurgaon."

Snapdeal's employee strength in other operations, for instance, vendor management, have also been coming down due to the ongoing restructuring drive. According to Snapdeal insiders, the senior management has asked employees across the country to improve their performance benchmark resulting in higher targets to improve efficiencies among its shrinking employee base. This is putting the existing workforce base under pressure as well.

Earlier in February this year, the company had faced strong protests when employees alleged that the company was looking to outsource customer support duties and cut jobs. TOI had reported then that Snapdeal had started slashing employee count at its contact centre since November last year, bringing down the headcount to about 600 from a peak of 1,800-2,000. As a result, mostly, entry and junior level employees in the contact centre were affected as the company did not want to have people on its roll for services which could be outsourced.

Snapdeal has raised about $1.5 billion so far from myriad investors and is under pressure to improve its unit economics and aim for profitability. Recently, its co-founder and CEO Kunal Bahl said the company was not looking at gross merchandise volume (GMV) anymore as a key metric and was focusing on driving consumer satisfaction and more efficiency across operations. GMV is the overall sales done on an e-commerce platform without factoring in discounts and returns via sellers.